General Risk Warning

Last Update: 21 Jan 2025

A. How to interpret this Risk Warning

All capitalised terms used in this Risk Warning that are defined in the CoinOTC Terms of Use (the “Terms of Use”, which includes any Product Terms (as defined in the Terms of Use)), have the same meaning and construction as in the Terms of Use.

B. CoinOTC Services

In line with our commitments to compliance and user protection, this Risk Warning provides you with information about some of the key risks associated with CoinOTC Services. Each CoinOTC Service has its own distinct risks. This Risk Warning provides a general description of some of the risks that may arise when you use CoinOTC Services.

This Risk Warning does not explain all of the risks or how such risks relate to your personal circumstances. It is important that you fully understand the risks involved before making a decision to use CoinOTC Services and you should also read the relevant terms applicable to the specific CoinOTC Service. By using the CoinOTC Services and entering into any Transactions, you agree that you assume all of the related risks.

C. No Personal Advice

We do not provide personal advice in relation to CoinOTC Services. We sometimes provide factual information, information about transaction procedures and information about the potential risks. However, any decision to use CoinOTC Services is made by you. No communication or information provided to you by CoinOTC is intended as, or shall be considered or construed as, investment advice, financial advice, trading advice, or any other sort of advice. You are solely responsible for determining whether any investment, investment strategy or related transaction is appropriate for you according to your personal investment objectives, financial circumstances and risk tolerance.

D. No Monitoring

CoinOTC is not your broker, intermediary, agent, or advisor and has no fiduciary relationship or obligation to you in connection with any trades or other decisions or activities undertaken by you using CoinOTC Services. We do not monitor whether your use of CoinOTC Services is consistent with your financial goals and objectives. It is up to you to assess whether any activity that you engage in through the CoinOTC Services is appropriate given your financial position and risk appetite.

E. No Tax, Regulatory or Legal Advice

You have sole responsibility for determining what taxes you might be liable to, how and when they apply, and meeting such tax obligations, when transacting through the CoinOTC Services. It is your responsibility to report and pay any taxes that may arise from entering into a Transaction by using the CoinOTC Services, and you acknowledge that CoinOTC does not provide legal or tax advice in relation to these transactions. If you have any doubts about your tax status or obligations when using CoinOTC Services, or with respect to the Digital Assets held to the credit of your CoinOTC account, you are encouraged to seek independent advice.

You acknowledge that, when, where and as required by Applicable Law, CoinOTC shall report information regarding your transactions, transfers, distributions or payments to tax or other public authorities. Similarly, when, where and as required by Applicable Law, CoinOTC shall withhold taxes related to your transactions, transfers, distributions or payments. Applicable Lawscould also prompt CoinOTC to request that you provide additional tax information, status, certificates or documentation or other information. You acknowledge that failure to comply with these requests within the specified timeframe, may result in taxes withheld by CoinOTC, to be remitted to tax authorities as defined by Applicable Law. You are encouraged to seek professional and personal tax advice regarding the above and before entering into any Transaction.

F. Market Risks

An investment in Digital Assets carries significant risk. The value of an investment and any returns can go up or down, and you may lose all or part of your investment and not get back the amount you had invested. If you are new to Digital Assets, consider investing only a small amount. Only invest what you can afford to lose. It is important to do your own research to understand the risks of investing in Digital Assets.

Digital Asset trading is speculative, prices are volatile and market movements are difficult to predict. Supply and demand for Digital Assets can change rapidly without warning and can be affected by a variety of factors which may not be predictable, including regulation, general economic trends and developments in the Digital Asset ecosystem. All investments in Digital Assets carry the risk of loss.

Past performance is not an indicator of future performance. CoinOTC does not in any way guarantee or provide any assurance about the performance or market price of Digital Assets or products available through the CoinOTC Services.

The Digital Asset industry is subject to systemic and systematic risk. Systemic and systematic risks are both threats to the Digital Asset markets and economy, but the cause of these risks and the approaches for managing them are different. Systemic risk is the risk that a company or industry-level risk could trigger a major collapse. Systematic risk is the risk inherent to the entire market, which can be economic, sociopolitical, technological, or natural in origin. These risks can affect the prices of Digital Assets.

Blockchain technology is a relatively new technology that is evolving rapidly and is likely to be subject to continued technological development. The future development and growth of the Digital Asset industry is subject to a variety of factors that are difficult to predict and evaluate. Similarly, the sustainability of Digital Asset networks may also be affected by a range of different factors. All such factors may impact the value of a Digital Asset.

Negative perceptions about Digital Assets may reduce the confidence of investors in the industry and result in greater volatility of the prices in Digital Assets, including possibly a significant depreciation in value. Any events that trigger negative publicity in respect of Digital Asset markets may therefore have an adverse impact on the value of any investment in Digital Assets.

G. Counterparty Risk

You may be exposed to counterparty risk in various circumstances when using CoinOTC Services. This may include, without limitation, if a market maker or liquidity provider faces issues which could result in slippage or an inability to execute trades; failures by or disputes with payment processors which may delay deposit and withdrawal transactions; borrowers defaulting on their repayment obligations which may delay the redemption of deposits from certain products.

In such other exceptional circumstances, your holdings and your ability to transact or deal with your holdings, may be adversely affected which may result in a range of outcomes including, without limitation, transactions not completing as expected, trading costs being irrecoverable, loss of profits, inability to acquire or dispose of assets at the desired time or price.

H. Liquidity risk

Digital Asset prices on the secondary market are driven by supply and demand and may be highly volatile. Digital Assets may have limited liquidity which may make it difficult or impossible for you to sell or exit a position when you wish to do so. This may occur at any time, including at times of rapid price movements.

I. Fees & Charges

Our fees and charges are set out here. CoinOTC may, in its discretion, update the fees & charges from time to time. Please be aware of all fees and charges that apply to you, because such fees and charges will affect the returns you generate from using CoinOTC Services.

J. Availability Risk

While we aim to deliver a seamless user experience, we cannot guarantee that the CoinOTC Services will be available at any particular time or that CoinOTC Services will not be subject to unplanned service outages or network congestion. It may not be possible for you to buy, sell, transfer, send or receive Digital Assets when you wish to do so.

There are legal requirements in various countries which may restrict the products and services that CoinOTC can lawfully provide. Accordingly, some products and services and/or certain functionality within the Platform, including but not limited to fiat services, may not be available or may be restricted in certain jurisdictions or regions or to certain Users and any CoinOTC campaigns, user competitions or other promotions will not be open to (and are not targeted at or intended for) Users to whom restrictions apply. Users are responsible for informing themselves about, and observing any restrictions and/or requirements imposed with respect to, the access to and use of the Platform and the CoinOTC Services in each jurisdiction from which the Platform and the CoinOTC Services are accessed by or on behalf of the User. CoinOTC reserves the right to modify such restrictions or impose additional restrictions with respect to the access to and use of the Platform and/or the CoinOTC Services from time to time in its sole discretion without notification.

K. Third Party Risk and Third Party Users

a. Third parties, such as payment providers, custodians, and banking partners may be involved in the provision of CoinOTC Services. You may be subject to the terms & conditions of these third parties.,Unless expressly provided otherwise, CoinOTC will not be responsible for any loss that may be incurred by you as a result of or arising from the services provided by such third parties.

b. Third party users of the account: Where you are an individual user, you will use your CoinOTC account only for yourself, and not on behalf of any third party; and Where you are a corporate user, your Permitted Users (Operators) will use the Corporate/Business CoinOTC Account only for your benefit, and not on behalf of any third party, unless our prior written consent has been obtained. Additionally, you will not offer direct market access to the Platform to any other party, including through the use of a sub-account, unless and until such other party has completed identity verification deemed appropriate by CoinOTC and has separately onboarded. Any other party so verified shall be considered a “Permitted User” as that term is described herein. For avoidance of doubt, any entity or individual using a CoinOTC Operator Account must be separately verified to be considered a “Permitted User” and to be permitted to use the CoinOTC Services. You are fully responsible for all activity that occurs under your CoinOTC Account.

L. Security Risk

The nature of Digital Assets exposes them to an increased risk of cyberattack. While CoinOTC uses all reasonable efforts to safeguard Digital Assets and protect the Platform from cyberattack, it is not possible for any exchange to eliminate security risks entirely. There can be no guarantee that systems in place to mitigate cybersecurity threats will always be effective to prevent improper access to the Platform and Digital Assets.

You are responsible for keeping your CoinOTC Account information safe, and you shall be responsible for all the Transactions under your CoinOTC Account, whether you authorised them or not. Transactions in Digital Assets may be irreversible, and losses due to fraudulent or unauthorised transactions may not be recoverable.

M. Risks related to Digital Assets

Given the nature of Digital Assets and their underlying technologies, there are a number of intrinsic risks, including but not limited to:

a. faults, defects, hacks, exploits, errors, protocol failures or unforeseen circumstances occurring in respect of a Digital Asset or the technologies or economic systems on which the Digital Asset rely;

b. transactions in Digital Assets being irreversible. Consequently, losses due to fraudulent or accidental transactions may not be recoverable;

c. technological developments leading to the obsolescence of a Digital Asset;

d. network delays causing transactions to not be settled on the scheduled delivery date;

e. attacks on the protocol or technologies on which a Digital Asset depends;

f. a hard fork may occur if Digital Asset developers suggest changes to a particular Digital Asset software and the updated software is not compatible with the original software and a sufficient number (but not necessarily a majority) of users and minors elect not to migrate to the updated software. This would result in two versions of Digital Asset networks running in parallel and a split of the blockchain underlying the Digital Asset network, which could impact the demand of the Digital Asset and adversely impact the price of the Digital Asset;

g. certain addresses on the blockchain networks hold a significant amount of the currently outstanding asset on that network. If one of these addresses were to exit their positions, this may result in volatility that could adversely affect the price of that asset;

h. if anyone gains control of over 51% of the computing power (hash rate) used by a blockchain network, they could use their majority share to double spend their Digital Assets. Whilst the risk of this occurring for networks with wider adoption is remote, if such a “51% attack” were to be successful, this would significantly erode trust in public blockchain networks (like Bitcoin and Ethereum) to store value and serve as a means of exchange, which may significantly decrease the value of Digital Assets;

i. Digital Assets are subject to the risk of fraud or cyber attacks;

j. Digital Assets purchased and held in an account with CoinOTC are not covered by any external investor compensation, customer asset protection, deposit protection, insurance or other similar schemes; and

k. new risks may arise from investing in new types of Digital Assets or market participants’ engagement in more complex transaction strategies. Digital Assets and the Digital Asset market is subject to speculative interest, rapid price swings and uncertainty.

N. Monitoring Risks

Digital Asset markets are open 24 hours a day, 7 days a week. Rapid price changes may occur at any time, including outside of normal business hours.

O. Communication Risks

When you communicate with us via electronic communication, you should be aware that electronic communications can fail, can be delayed, may not be secure and/or may not reach the intended destination.

P. Currency

Currency exchange fluctuations may impact your gains and losses.

Q. Legal and Regulatory Risks

Most Digital Assets operate without a central authority and are generally not backed by any government or authority. Changes in laws and regulations may materially affect the value of Digital Assets. This risk is unpredictable and may vary from market to market.

Further, Digital Assets may not be considered “property” under Applicable Laws in some jurisdictions. This may affect the nature and enforceability of your interest in the Digital Assets.

Legislative and regulatory changes may adversely affect or restrict (as applicable) the use, transfer, exchange and value of Digital Assets, as well as the provision of the CoinOTC Services in certain jurisdictions. Legislative and regulatory changes may occur quickly and without prior notice.